Jamaican media group RJR experienced a poor first quarter ended June 30, 2022, with losses amounting to J$39.84 million relative to a profit of J$110.43 million for the corresponding period in 2021.
Operating loss closed the period in review at J38 million versus operating profit of J$159.89 million in 2021. Tax credit amount to J$10.87 million in 2022 relative to a tax charge of J$37.26 million incurred in 2021.
As a result, the net loss for the period closed at J$39.84 million relative to a profit of J$110.43 million in 2021. Net loss attributable to shareholders amounted to J$43.38 million versus profit of J$100.55 million booked in the same period last year.
Loss before taxation closed the three months amounted to J$50.71 million relative to profit before taxation of J$147.69 million documented in the previous comparable period. The losses per share (LPS) for the three-month period amounted to J$0.018 versus an earnings per share of J$0.042 in 2021.
RJR stock last traded on August 5, 2022 at J$2.61 with a corresponding P/E of 33.03 times.
Marginal rise in cost as revenue declined
Finance costs increased four per cent year-on-year to $12.71 million when compared to the corresponding period in 2021 amount of $12.17 million. Revenue for the three months ended June 30, 2022, declined by nine per cent to J$1.30 billion, down from J$1.42 billion in the prior comparable period.
The management reports that the decline was “driven mainly by decreases in the Audio/ Visual division (12 per cent), Print and Online (six per cent) and Audio (two per cent).” Direct expenses increased to J$588.20 million; this compares to the prior year’s figure of J$493.96 million, representing an increase of 19 per cent.
RJR says the increase was “due mainly to increased newsprint costs, increased costs for the staging of the Boys’ and Girls’ Championships, along with the higher cost of the National Track and Field Trials.” As such, gross profit amounted to J$710.07 million relative to J$926.20 million for the corresponding period in 2021.
Operating expenses increased for the period under review by three per cent from J$795.19 million in 2021 to J$816.06 million in 2022. There was a seven per cent increase in selling expenses to J$259.27 million (2021: J$242.85 million), and a six per cent decrease in administrative expenses to J$341.57 million (2021: J$362.10 million).
Banking on acquisition of 1834 Investments Limited
Other income went up for the period to J$67.98 million compared to the 2021 figure of J$28.87 million. RJR says upon completion of their acquisition of 1834 Investments Limited, shareholders “will see an increase in their asset base of RJRGLEANER, an increase in available cash to complete our strategic digital investments”
As at June 30, 2022 RJR recorded total assets of J$4.99 billion, an increase of seven per cent when compared to J$4.65 billion for the previous corresponding period. This was attributable to a 46 per cent increase in ‘Fixed Assets’ to J$1.99 billion (2021: $1.36 billion) and a 13 per cent increase in ‘Cash and Bank Balances’ to J$687.72 million (2021: J$606.36 million).
Total Stockholders’ equity as at June 30, 2022 closed at J$2.74 billion, an increase of four per cent from J$2.63 billion last year. This resulted in a book value of J$1.13 compared to a 2021 value of J$1.09.